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(08-06-2014, 10:04 PM)opmi Wrote: (08-06-2014, 09:21 PM)kazukirai Wrote: Speaking of leaving wealth to descendants/beneficiaries who can't handle it...any VBs thought of leaving behind your assets in a trust? Just curious because it seems to be more common in the West but there is a probability that the generation(s) after the one that created the wealth might turn out to be incompetent at managing their finances.
Having said that, the structure and payout is important. I read the story of the Johnson & Johnson dynasty (the book's called "Crazy Rich") and most of the later generations had highly dysfunctional lives thanks to their incomes from their trust fund.
Regarding the inheritance, it is about incentives and motivations.
Trust funds babies simply don't have incentive and motivation to work hard.
Anything seen as 'ah kong' money will be squandered away.
An important lesson in financial education is resisting instant gratification. Anyone who cannot fight this urge, will find it hard to accumulate assets, even though they are very hardworking.
Sent from my iPhone using Tapatalk Yes! Even if you are very thrifty but your spouse is spendthrift, it's really very hard to accumulate assets. So choose your spouse well and then don't complain after.
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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(08-06-2014, 10:04 PM)opmi Wrote: (08-06-2014, 09:21 PM)kazukirai Wrote: Speaking of leaving wealth to descendants/beneficiaries who can't handle it...any VBs thought of leaving behind your assets in a trust? Just curious because it seems to be more common in the West but there is a probability that the generation(s) after the one that created the wealth might turn out to be incompetent at managing their finances.
Having said that, the structure and payout is important. I read the story of the Johnson & Johnson dynasty (the book's called "Crazy Rich") and most of the later generations had highly dysfunctional lives thanks to their incomes from their trust fund.
Regarding the inheritance, it is about incentives and motivations.
Trust funds babies simply don't have incentive and motivation to work hard.
Anything seen as 'ah kong' money will be squandered away.
An important lesson in financial education is resisting instant gratification. Anyone who cannot fight this urge, will find it hard to accumulate assets, even though they are very hardworking.
I guess the lesson here is, as much hard work and thought is put into their investing journey, VBs should not spare any less efforts towards making a similar impact for their dependents' financial discipline and temperament.
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i think a person's Temperament though may be cultivated to a certain extent, it is more a born with thing rather than something you can acquire with knowledge or training. Just like IQ.
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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suddenly I feel so safe with my monies with cpf, cpf is the best..i can see the underlying message
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Sorry side track a bit.
Can anyone help me?
When i use "Send this Thread to a Friend", it doesn't works anymore.
i test it sending to myself, it doesn't work too.
Though the message is thread is sent.
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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Can be taught. Lead by example. Monkey see monkey do.
Just to share on instant gratification. Teacher friend say a lot of his students on Financial Assistance Scheme. These students will work part time. But when they get the pay, they will splurge on iPhone or pay for the phone bills. No savings. I think this work-spend-work cycle will continue in their adult life.
Sent from my iPhone using Tapatalk
"... but quitting while you're ahead is not the same as quitting." - Quote from the movie American Gangster
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She should have put her money in a "special fund" that earns her an interest rate of about 2.5%. And when she reach a certain age, the fund will "pay" her a nominal sum per month with her own money. That is the "correct and only way" how normal people should manage their money. 
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09-06-2014, 12:58 AM
(This post was last modified: 09-06-2014, 01:04 AM by Big Toe.)
Chances are that money that is not earned through one's ability will be lost sooner rather than later.
If a self made man, by a stroke of bad luck/tragic event, lost his entire fortune, will have a much higher chance of earning his fortune back. Will take time, but will get there eventually. And there's a self made man that is about to list his company in the U.S.....Jack Ma. And boy is he smart, better business sense than Jeff bezos, me thinks. Instead of earning money from selling everything and swallowing the high overheads, jack ma choose the more profitable side of things, being the biggest e-commerce enabler and housing the most number of e-merchants(and all the profits associated with it).
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(08-06-2014, 09:21 PM)kazukirai Wrote: Speaking of leaving wealth to descendants/beneficiaries who can't handle it...any VBs thought of leaving behind your assets in a trust? Just curious because it seems to be more common in the West but there is a probability that the generation(s) after the one that created the wealth might turn out to be incompetent at managing their finances.
Having said that, the structure and payout is important. I read the story of the Johnson & Johnson dynasty (the book's called "Crazy Rich") and most of the later generations had highly dysfunctional lives thanks to their incomes from their trust fund.
From my understanding, forgive me if I am wrong, if the amount of money to be placed in a trust is small, usually it is used to invest in endowments or unit trusts. Usually there will not be any active management (shifting money with the market), but there are still charges to maintain it. Is it worthwhile to do so?
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(08-06-2014, 03:29 PM)flinger Wrote: I don't understand this statement from the news article,
"That last $400,000 she withdrew lasted her five months."
400,000 in five months??
She spent 3333 per day for 5 months?
Who does that?
Likely gambled away, so too shameful to mention.
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